Inside the industry: EV transition needs massive investment

Cost of public charging raises prospect of huge inequality in the cost of accessing mobility

The cost of necessary infrastructural investment is estimated at £210 billion

Around three million new public charging points are needed across Europe by 2030 if the mandated sale of EVs is to be supported adequately, up from around 375,000 in 2021. That’s an eight-time expansion in nine years, according to a report by McKinsey on behalf of the European Automobile Manufacturers’ Association.

The final part of that sentence signals a note of caution: this report is written to service the car makers’ needs, which basically amount to an adequate infrastructure being in place so there are no barriers to anyone wanting to buy the cars in which they have invested billions. But it remains interesting, nevertheless.

The cost of that infrastructure is estimated at £210 billion, with £36bn earmarked for grid upgrades and £64bn for investment in renewable energy. The report surprisingly (perhaps improbably) claims around 42% of EV owners living in cities today don’t have access to home charging, but more realistically noted that public charging is typically 30-200% more expensive than home charging, raising the prospect of huge inequality in the cost of accessing mobility, both financially and in terms of time.

Giving an idea of the scale of the requirements – as well as opportunities for companies working in the area – the goal of 3.4 million public charging points is on top of an estimated 29 million private ones that are modelled to be required at owners’ homes. That means installing roughly 6000-10,000 public charging points a week, up from 1600 a week in 2021. Today, France (400 per week) and Germany (200) are moving fastest, but nowhere near fast enough. The report also highlights the risk of installing too many chargers: if that happens, they could be under-used, unprofitable and more likely to be left unserviced.

One area of less concern is the amount of energy electric vehicles will use. The report suggests EV charging could increase from nine terawatt hours in 2021 (less than 1% of the EU-27’s current total) to 165 terawatt hours in 2030. In other words, even though EV-specific electricity demand may grow by around 40% a year, it would still represent only about 6% of all electricity consumed.

The positive potential of using EVs to store energy is also explored. The report reckons that drawing on the capacity of plugged-in EVs – likely at some point after 2030 – would provide three terawatt hours of storage, equivalent to 40% of the EU’s daily average energy demand. That’s crucial, both for ensuring the full potential of renewable energy is harnessed and ending energy dependency on individual providers.

The report’s motives and findings are likely to be debated, but what’s dawning is just how hard, yet necessary, the transition is. Naming an end date for the sale of combustion cars was easy; the hard work that needs completing by then has only just begun.